Cellular Telephones On A Roll

October 8, 1985|By Susan G. Strother of The Sentinel Staff

The number of motorists using cellular mobile telephones more than doubled during the first six months of 1985, according to a nationwide survey that may ease somewhat the infant industry's concern about the technological and competitive problems it faces.

At least 203,600 people across the country, including more than 11,000 in Florida, have added the new mobile phones to their cars or trucks since companies began offering the service in selected cities last year, according to the survey released Monday by the Cellular Telecommunications Industry Association.

Robert W. Maher, executive director of the Washington, D.C.-based group, said the jump in the number of customers and an increase in industry spending for construction and equipment indicate that cellular phones will not go the way of faddish citizens' band radios and eight-track tape decks.

''A lot of people thought we were not growing very fast,'' Maher said. ''What we are seeing is dramatic growth in existing cities'' as well as solid growth in areas where service began only recently.

Cellular technology uses a network of radio towers, or ''cells,'' to carry mobile-telephone calls within a given city or service area. Calls are transferred automatically by computer from tower to tower as a motorist passes from one cell to the next. The service is far superior to earlier mobile- telephone systems, which suffered from limited capacity and poor sound quality.

The Orlando area's cellular-phone service, which began operating in February, now serves 1,300 customers, according to BellSouth Mobility Inc., one of two companies offering the service. Orlando is the 60th-largest cellular market in the country, behind No. 12 Miami-Fort Lauderdale, No. 30 Tampa and No. 51 Jacksonville.

The CTIA's national survey found that the number of cellular customers increased by nearly 104 percent, from 100,000 on Jan. 1 to 203,600 by June 30. Companies' investment in equipment, which averages $500,000 for each cell in a service area, increased about 66 percent during those six months, from $354.76 million to about $588.75 million. The number of cells, or towers, increased from 346 to 599.

According to the Federal Communications Commission, which licenses mobile-phone operators, 62 markets were served by cellular service in June compared with 28 at the first of the year. The FCC said 72 companies now own and operate cellular-phone systems across the country.

The CTIA survey also found that the number of ''resellers'' -- smaller companies that buy transmitting time from an owner and resell it to customers -- increased by 97 percent from January to June, from 107 agents to 211. The number of companies involved in the sale of mobile telephones and related equipment rose at an almost identical rate, from 459 to 902.

Maher said the typical cellular-phone customer is a salesperson, real estate agent or repair person who needs to be in frequent contact with a main office or customers.

Despite the dramatic growth in their popularity, cellular phones are used by fewer than 1 percent of all U.S. drivers. Such a small overall market has sparked price wars in some cities, resulting in some cases in drastic discounts for equipment. Nationally, the CTIA said, it costs a customer an average of $150 a month for equipment rental and service.

According to Mark Dunkel, a vice president for The Robinson-Humphrey Co., an Atlanta brokerage, some equipment manufacturers overestimated the strength of the cellular market. Overproduction of equipment and failure to set competitive prices have forced some out of business, he said.